Behind-the-scenes look at White Center Square – in 2 ways
(National Development Council’s Michelle Morlan with White Center Square developer Con Vong)
By Tracy Record
White Center Now
Con Vong says his family hasn’t chosen the date yet for the anticipated July grand opening of White Center Square, but the choice will be a big one: “You’ve got to pick a good day.”
The date was strategically chosen, after all, for last May’s groundbreaking (WCN coverage here) at the site along 100th between 14th and 15th SW (map), and the ceremony featured prayers and blessings as well as shovels.
Now, 10 months later, the buildings are up, though the future 68-space parking lot is still rocks, dirt and heavy equipment. We took a hard=hat tour of the site this week at the invitation of local reps from the National Development Council, a nonprofit agency that helped arrange the financing for the $11 million project, including the use of New Markets Tax Credits – a federal program whose future is by no means guaranteed, which is why those involved with it are working to get the word out about what it’s helped achieve.
At the White Center Square site, a new 11,000-square-foot Vong’s market is the centerpiece. That’s double the size of the family’s current market less than a block north, where they’ve been in business more than a decade – here’s a quick video look inside:
As we stand in the cavernous space with two local NDC reps, their communications liaison, and a construction manager, Con Vong points to corners where the expanded deli will go, where the meat section will go, where the produce section will go.
The market and its future parking lot, not yet paved, are flanked by two buildings with retail spaces – here’s the view, east to west:
Inside the two retail buildings, the high-ceilinged spaces all have front and rear entries, so the potential exists for customers and workers to enter either from the parking lot or from the 15th and 14th SW streetfronts.
From the eastern side, you can see across 14th to popular Big Al Brewing:
Five units remain to be leased, Vong says – two on the east side, three on the west. The businesses ready to move into the new center include the restaurant that Vong’s family currently operates by the existing market, a jewelry store, a mortgage broker, and a salon.
But none of this would be happening if not for a unique financing deal.
Vong said he had tried for a year to get financing the more typical way. Then the White Center Community Development Association helped connect him with the people who helped the four-part deal come together. It’s a partnership between King County – through a U.S. Housing and Urban Development (HUD) Section 108 loan – the National Development Council, US Bancorp (which invested in equity and therefore qualifies for the aforementioned New Markets Tax Credits), and Vong’s, which also contributed equity. (The family had already purchased the land before this deal came together.)
After touring the project site, we sat down over tea with our tour guides to find out more about the unique financing and why they want you to understand it.
New Markets Tax Credits (as explained here, the investor gets a tax credit worth 39 percent of the investment, over 7 years) aren’t available everywhere. According to background material provided by the NDC reps, White Center “meets numerous deeper distress criteria” that are a requirement for NMTC, including a higher poverty rate, a lower median family income, and higher unemployment. It’s pointed out to us multiple times that the White Center Square project, when fully leased out, should provide about 60 jobs to the area.
And yet, in a time when jobs are so badly needed, banks have clamped down on commercial-project financing, as they deal with challenges of their own. “Small business is very risky,” acknowledges the project lead for NDC, Michelle Morlan. So that’s where deals like this come into play. She says there’s already $200 million in NMTC-assisted development in the Seattle area, and that our state has the third-most nationwide. Another new White Center project funded in part with NMTC was dedicated just last month – the Educare Early Learning Center (WCN video coverage here) at Greenbridge, which included $4.1 million NMTC through the King County Housing Authority.
But the program was initially funded for only five years, after its creation in 2000, and since then has come up for renewal annually. “It would be great for it to be permanent,” smiles Morlan.
That’s not the only tool used here that overall has an uncertain future. Morlan’s colleague Chuck Depew, also an NDC director based in Seattle, points out that the HUD 108 loan, in this case accessed through King County, is also something of an underappreciated program. “HUD is fairly indifferent to it,” he explains, “and every year it’s a struggle to get it renewed.” The agency, he elaborates, is more focused on the “housing” mission than the “urban development” mission these days, it seems, but White Center Square is a prime example of the latter. “Every year, we have to have a lot of people write letters” to keep the HUD 108 program from being killed, Morlan adds.
Certainly you can conclude they’re advocating for these programs because their jobs may depend on their existence. But these aren’t the only tools with which they deal. As we talk for a while, about the greater Seattle area as well as White Center itself, Morlan and Depew realize there’s something else they could mention – the fact their agency also acts as a consultant, lending its expertise to projects needing to put together funding packages, even ones that don’t involve NMTC. Depew, who worked on the mentioned-earlier Educare project, also worked on the Fauntleroy Schoolhouse purchase (which recently closed) in West Seattle (their role was explained in this document for a March 2008 public meeting about that project)
But for now, they’re proudly pointing to the approaching-completion White Center Square as one of the newest examples of their work, and hoping you appreciate a little more of what it took to make it happen, when the owner had gotten the thumbs-down while searching for funding in a more conventional way. And by the way, if you have or know of a business that might be interested in leasing one of those remaining White Center Square spaces, you can call Willie Vong, 206-229-5177.
*Chuck DePew helped put together the Fauntleroy Schoolhouse deal.
Tags: National Development Council, New Markets Tax Credits, White Center Square
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